HMRC Files Winding-Up Petition Against Liberty Steel Pipes Business

Financial Challenges and Legal Actions Affect Liberty Steel

British tax authorities have taken legal action against one of the key businesses within the Liberty Steel empire, signaling growing financial pressures on the company. The latest development involves a winding-up petition filed by HM Revenue and Customs (HMRC) against Liberty Pipes (Hartlepool), a facility located in northern England that specializes in manufacturing pipes. This move has raised concerns about the stability of the business and its future operations.

The court filings indicate that HMRC is the petitioner in this case, and the petition appears to be related to an unpaid value-added tax (VAT) bill. However, Liberty Pipes has responded by stating that all outstanding payments to HMRC have been settled, and there is no immediate threat to the Hartlepool operations. The facility continues to function normally, employing 178 people. A spokesperson for the company emphasized that it has no outstanding debts to HMRC and is working with the agency to have the petition removed.

An HMRC representative stated that the organization adopts a supportive approach when dealing with taxpayers who have outstanding tax obligations. Winding-up petitions are only pursued after all other options have been exhausted, as a measure to protect public funds.

This latest legal challenge is part of a broader pattern of financial strain affecting Liberty Steel, which is a central component of Sanjeev Gupta’s GFG Alliance. This network of companies spans multiple countries, including Australia, Singapore, Romania, and northern England. Since the collapse of Greensill Capital in 2021, which had provided approximately $5 billion in loans to GFG, the group has faced significant challenges. The failure of Greensill has led to ongoing negotiations between Gupta’s companies and the administrators of the collapsed firm, who are seeking to recover the lost funds.

GFG has also been under investigation by the UK’s Serious Fraud Office since 2021, following allegations linked to the Greensill financing. The company and Gupta have consistently denied any wrongdoing. Additionally, Gupta faces legal proceedings from Companies House over his failure to file accounts for more than 70 UK-based businesses, including those of Liberty Pipes (Hartlepool). He has pleaded not guilty to these charges.

Other parts of Liberty Steel’s operations in the UK are at risk of closure unless new funding can be secured. An upcoming insolvency hearing, scheduled for later this month, will determine the fate of Speciality Steel UK, which employs 1,450 workers in South Yorkshire and operates two facilities in Rotherham and Stocksbridge. Reports suggest that UK ministers may consider intervening to prevent these sites from closing if they fall into administration.

The Hartlepool factory, located in County Durham, has the capacity to produce 250,000 tonnes of pipes annually. These pipes are used in oil and gas pipelines as well as structural hollow sections for buildings. However, Liberty Steel’s operations may face further disruptions due to issues at other parts of the business. For instance, the Liberty Dalzell plate mill in Motherwell, near Edinburgh, has not produced any products since July 2024. This mill previously supplied plate steel to the Hartlepool facility.

Financial records for the Hartlepool company, covering the year ending March 2020, showed a small profit. Despite this, the accounts revealed net liabilities of £4.7 million and indicated that the company relied heavily on its parent company, Liberty House Group, based in Singapore, to maintain operations.

A source close to the company has denied that Liberty Pipes is in financial distress, attributing the situation to “administrative errors” at HMRC. They added that the company is currently working on a North Sea carbon-capture pipeline project, highlighting its ongoing efforts to secure new opportunities and sustain its operations.